Veterans and zombies

Let’s focus on the big problems in health care

June 20, 2014 8:36 PM

By Paul Krugman

You’ve surely heard about the scandal at the Department of Veterans Affairs. A number of veterans found themselves waiting a long time for care, some of them died before they were seen, and some of the agency’s employees falsified records to cover up the extent of the problem. It’s a real scandal; some heads have rolled, but there’s surely more to clean up.

But the goings-on at Veterans Affairs shouldn’t cause us to lose sight of a much bigger scandal: the almost surreal inefficiency and injustice of the American health-care system as a whole. And it’s important to understand that the Veterans Affairs scandal, while real, is being hyped out of proportion by people whose real goal is to block reform of the larger system.

The essential, undeniable fact about American health care is how incredibly expensive it is — twice as costly per capita as the French system, two and a half times as expensive as the British system. You might expect all that money to buy results, but the United States actually ranks low on basic measures of performance: We have low life expectancy and high infant mortality and, despite all that spending, many people can’t get health care when they need it.

What’s more, Americans seem to realize that they’re getting a bad deal: Surveys show a much smaller percentage of the population satisfied with the health system in America than in other countries. And, in America, medical costs often cause financial distress to an extent that doesn’t happen in any other advanced nation.

How and why does health care in the United States manage to perform so badly?

There have been many studies of the issue, identifying factors that range from high administrative costs, to high drug prices, to excessive testing. The details are fairly complicated, but if you had to identify a common theme behind America’s poor performance, it would be that we suffer from an excess of money-driven medicine.

Vast amounts of costly paperwork are generated by for-profit insurers always looking for ways to deny payment; high spending on procedures of dubious medical efficacy is driven by the efforts of for-profit hospitals and providers to generate more revenue; high drug costs are driven by pharmaceutical companies who spend more on advertising and marketing than they do on research.

Other advanced countries don’t suffer from comparable problems because private gain is less of an issue. Outside the United States, the government generally provides health insurance directly or ensures that it’s available from tightly regulated nonprofit insurers; often, many hospitals are publicly owned and many doctors are public employees.

As you might guess, conservatives don’t like the observation that American health care performs worse than other countries’ systems because it relies too much on the private sector and the profit motive. So whenever someone points out the obvious, there is a chorus of denial, of attempts to claim that America does, too, offer better care.

It turns out, however, that such claims invariably end up relying on zombie arguments — that is, arguments that have been proved wrong, should be dead, but keep shambling along because they serve a political purpose.

Which brings us to veterans’ care. The system run by the Department of Veterans Affairs is not like the rest of American health care. It is, if you like, an island of socialized medicine, a miniature version of Britain’s National Health Service, in a privatized sea. And until the scandal broke, all indications were that it worked very well, providing high-quality care at low cost.

No wonder, then, that right-wingers have seized on the scandal, viewing it as — to quote Dr. Ben Carson, a rising conservative star — “a gift from God.”

So here’s what you need to know: It’s still true that Veterans Affairs provides excellent care, at low cost. Those waiting lists arise partly because so many veterans want care, but Congress has provided neither clear guidelines on who is entitled to coverage nor sufficient resources to cover all applicants. And, yes, some officials appear to have responded to incentives to reduce waiting times by falsifying data.

Yet, on average, veterans don’t appear to wait longer for care than other Americans. And does anyone doubt that many Americans have died while waiting for approval from private insurers?

A scandal is a scandal, and wrongdoing must be punished. But beware of people trying to use the veterans’ care scandal to derail health reform.

And here’s the thing: Health reform is working. Too many Americans still lack good insurance and hence lack access to health care and protection from high medical costs — but not as many as last year, and next year should be better still. Health costs are still far too high, but their growth has slowed dramatically. We’re moving in the right direction, and we shouldn’t let the zombies get in our way.